tv Fast Money CNBC January 20, 2016 5:00pm-6:01pm EST
the s&p and where earnings should be versus where they are forecast, this market isn't trading at a discount right now. so i imagine this will continue on for quite sometime. >> well we'll check in with you next week. thank you. carl roth, michael santoli on "closing bell." that does it for us. and "fast money" begins right now. it sure does. thanks, kelly. "fast money" does begin right now live from the nasdaq market side overlooking times square. i'm michelle caruso-cabrera in today for melissa lee. our traders on the desk today. hi, guy. tonight on "fast," the man who said sell the s&p until it hits 1900. he's back and he's got an even bolder call on where stocks are going next. plus are you worried we're in a bear market? we have the one sector that history said does well when stocks are in a freefall. we'll tell you what it is. and later, remember that talk
about there being a bubble in stocks and bonds. maybe the real bubble was in oil. commodities. maybe that is the bubble that just popped. a look at what that could mean for your money. but first a start with a wild day for the market. stocks staging a stunning comeback late in the day. think about that. the market is down 2.5% and we are still calling it a comeback. because the dow had fallen 565 at the dead low around noon. the s&p with steep losses after testing the 1800 early in the afternoon and still at the lowest level since 20146789 we made now lows and then bounced. what does that mean? does that mean the market found a floor? was it a key reversal? >> it was a reversal. pete who has been bullish, has recently gotten negative and cautious. karen as well who are is a value
investor, she's taken a cautious tone. and kudos to b.k. who talked about this event happening. so why say potentially good news. we traded down to the august 24th low in the s&p. passed through it, yes, but we did bounce and we bounced significantly. >> don't think the worst is over. but now you have to respect the fact you could see a knee-jerk reaction to the upside in the s&p. and that level being 1920. again, i don't think the worst is over but i would not be surprised to see the s&p rally a couple percent from the current levels. >> there is something strange about this. s&p touches the ebola low. >> you don't want to -- >> that was the last time. it was the ebola scare. >> here is what is interesting about today. it felt and looked like short covering. we had a couple of events throughout the day. you saw the biotech start to move and then berne afrpgy said something about the dollar in hong kong, maybe about the run being over. and then the emergency meeting
with janet yellen which is huey and then the readings for tomorrow. and a lot of people covering shorts. and look at the stocks that rally. chesapeake rallied up 25. it is crazy type of moves today. so to me it seemed like a short cover rally. it could continue up to the guy's level of 1920 but i don't think this is over with. >> a lot of rumors about sovereign wealth funds having to sell. >> we did get a spike in the volatility index. we got up to about 32 at our lows. and guy referenced august. i'll go back to august as well. in august, we popped, up to over 53. now we had a huge jump 25%. up to 32% and then started the pullback. but then when you look at what reacted, it was the chesapeakes and the dash for the trash out there. but there was quality names that participated as well. take a look at something like nike. should that get sold off with the energy scare? we've been talking about the
coalition with oil. you see volatility still trading 26, 27, 28, well above the 20 and the 200 day moving average, when you go back to august this year, that lasts a month and a half. we are still three weeks into this. i think volatility is here for a while. i don't know whether or not we got to the lows today. but certainly it felt much better to see some of the stocks reacting. not the trash stocks but the quality stocks. >> jeffrey gun latch wanted to see the vix go to 40 before he would step into the high yield. >> 40 was the august -- i think -- >> that was the closing point. but 53 was the high. >> was the intra day high. and this felt, when the market was down 55 or 60 handles and things were trading innin ---in tethers, but when they trade in whole numbers something else is going on. i like that action.
things get ridiculously cheap. i bought some citibank today. nowhere near the bottom. but it seems so far overdone. of course it could go lower. i don't know when the bottom will be. but do think there will be a period where we look at where some things were trading and we'll say, wow, that was a bargain. >> but i will say the bond market continues to trade well. and we've discussed this for quite sometime, the fact that the interest rates could go lower than you think. and now the ten-year around the 2% level seemingly wanting to head down to 1.5%. i think that is absolutely still in tact. >> so you bought -- >> gold, i'm a believer, i'm a believer it could go higher from current levels. and i think the gold market is set up to move higher. nobody talks about it. very quietly, it is what i think is resistance level, i think it goes higher from here as well. >> did you buy anything? >> no. and i didn't sell anything. i sat on my hands. today didn't change my mind on
what is going down. last week i did cover a portion of my shorts. i still remain short the s&p and the at&t. and the one thing interesting about silver, it is mined as a byproduct of things like iron, ore and copper and if that is shut off, the supply will cut down. silver is a great buy. >> freeport and marathon oil, i've stayed short because i look at balance sheet and the leverage when you look at the debt levels, i think those -- >> they get hammered every day. >> they get hammered every day. and every time they come back, it is an opportunity to load up and buy. >> and those stocks could do a little rip your face off raleigh? >> but they will be real -- they won't be real rally. they will be rip your face off but you trade through the options market. we seen the paper, it started back into august, you look at paper. then after freeport and marathon
and the rest of the energy names. there was one name that stood out for me that i was staring at, i didn't jump on it because the option paper was indicating somebody was going very long-term. they went to 2017 -- >> which stock. >> selling puts in a domestic stock, target. you are talking about u.s.-centric type stock. selling puts and target with the opportunity of buying stock at $55 a share. two weeks ago our next guest said this about the marks. take a listen. >> you get a retest of the lows working at 1900. that is the big round number. at a minimum i think we test the 1900. we could cross that bridge when we get there. >> so let's cross that bridge. because we're there. rich rox of ever core is back with us with another bold call. rich, where do you see stocks going now? >> michelle, first of all, thanks for the clip there. that is fantastic. what i see we're set up for is a bounce, not a bottom. let's be perfectly clear, the intra day reversal, it wasn't a round trip of the decline, it
was the first signs of trend exhaustion throughout the horrendous start to the year. we get the reversal again. we reclaim most of the damage. we did close below the august lows of 1867 and below the 2014 september lows as well. now to me, looking at this chart, it still seems like a big head and shoulder top in motion. we've broken below the neckline. and when i move to the weekly, it doesn't get much better outside of the potential for that bounce here. once again, this is the 200-week moving average, this purple line here. we've held that line since 2011. that comes in around 1780. i think there is still a good case we get down there after a little bit of a bounce runs it's course. two years of zrush iedistributi. if you bought stock, you made nothing. look at the chart of the russell and the bkx and the transports. all of the break downs. i think we get to 1780. in 2011 we fell 22%.
1988, we fell 22%. here we are down, 12, 13, 14% but yet the back drop across assets is much more severe and dire than in 2011. given the erosion in currency, commodities, china and credit. speaking of which, this chart here perfectly encapsulates all of the fears into one. look at how tightly correlated that is with the eem for the emerging markets here. you can't tell me that the market is going to go meaningfully higher as long as this dynamic persists and it will persist as long as crude continues to move lower and there is nothing that tells me in the price action that won't happen. and finally, let's finish strong with china here. last time i was on we talked about the fears over the chinese yuan. and this is the hong kong dollar. we know that is being manipulated by the china and they are manipulating the stock market and the shanghai doesn't go down but what does go down, hang seng and the nikkei.
and the hong dong dollar is sold as a proxy for the yuan. it has broken the peg. it doesn't sound like a lot to stock traders. a 1% move is like scoring 100 points in a basketball game in the first three minutes of the game. and this rarely happens. this is the new warning sign. this is what you have to have on your screen. it potentially is a vision into a window of lower stock prices. 1780 is i think where we go and still a case made to be for 1670 to complete a sick lallal decline of 22%. >> when the hong kong dollar moves because the authority as lou it to do so, right? that would suggest they are under some kind of tremendous pressure to allow a move like that. >> no, exactly. and they could defend it just as the chinese are. and moves of these are rare and that speaks to the gravity of the current situation. but you make an excellent point. this won't go down without a fight and you would expect it to ease to firm as they defend the
currency and that is supportive of the little bit of a short-term risk reversal. a bounce in the s&p. but when i look at the weekly sharts and the s&p, i think we are on the downside of the mountain and we still have to go lower before ultimately we go higher. >> all right. thanks, rich. >> that is a tough -- >> it speaks for itself. it is thoughtful and more importantly it is correct. what he said in long form we said at the top of the show. it is not over. the potential for a bounce. i think 1920, we could differ on the levels, but the worst is probably not over yet. so i'm going to -- in accord with everything he said. if by some miracle we could get above 1920 and start to rally we are looking at an august bounce all over again and i don't think we are there. >> i was going to say, we have moved in correlation with the oil. the one thing i did see today, the volatility spiked today in oil, the ovx, up to near 72. we are near the high point versus the volatility index and so if you are looking at that and lock step with oil, has that
volatility peaked? >> what is -- >> 74 is the high. 72 is where we hit today. >> wow. so super close. and that relationship to vix to stock, and vix to oil, we could be close to -- >> yes. and look at the oil names. look at cle. down 30% in the last two days and then they start to rip back up. so they were trading like going out of business and clearly panic out there in the oil area. so that may be so. maybe we get a bounce in oil and the stocks. but again i still think it is a bounce. i'm short the hong kong dollar, i think we need to watch that. >> that was an old ackman trade. it will work out eventually. is it just us or is peter schiff starting to sound like legendary fund manager dallio. well tell you what he says that has investors running for the exits. and fresh lows and a big dividend cut is coming for big names. we'll tell you what names the traders see slashing dividend
this is year. and later, are you afraid we're in a bear market? well if we are, we found the one sector that history says does well if stocks continue into freefall. much more "fast money" after this. ou're a small business expert from at&t? yeah, give me a problem and i've got the solution. well, we have 30 years of customer records. our cloud can keep them safe and accessible anywhere. my drivers don't have time to fill out forms. tablets. keep it all digital. we're looking to double our deliveries. our fleet apps will find the fastest route. oh, and your boysenberry apple scones smell about done. ahh, you're good. i like to bake. get expert advice for your small business at att.com/small business.
in new york state, we believe tomorrow starts today. all across the state the economy is growing, with creative new business incentives, the lowest taxes in decades, and university partnerships, attracting the talent and companies of tomorrow. like in utica, where a new kind of workforce is being trained. and in albany, the nanotechnology capital of the world. let us help grow your company's tomorrow, today at business.ny.gov
welcome back to "fast money." we have an earnings alert on kinder morgan. to seema mody in the newsroom. >> that is right. reporting a surprising fourth quarter loss as it moved lower vols of oil and gas due to what management said is a challenging commodities environment. the company does not expect to access the capital markets to fund growth projects in 2016. remember, the company did slash the dividend by a whopping 75% in december. the stock is down 71% over the past one year. and kinder morgan has been seen as a poster child for the mlp sector. >> oh, yeah. certainly has. thanks, seema. let's trade it. kinder morgan. i'm looking at a yield of 17%, but that is still -- that is not accurate. >> they cut the dividend yield. there is no doubt about it. the pressure is on the names. we all know it. because everybody was going there as the safe haven.
i want my money and i need this yield and everybody was going to the mlps and now they are feeling pressure as these are getting cut. they are not getting the yield and the stocks the way they dropped. the yield doesn't even matter. that is why you never buy for yield. you buy for fundamentals. yield is just a cherry on top. >> amen. 100%. >> and this needs to washout. and the story with the mlp, you look at like an alp, that is the etf that trades these and they say it is just a toll road. but you ask yourself is that demand going to continue to be there. >> is there going to be as much traffic? >> we had a supply story. but is that traffic still going to be there. >> and who is paying for the traffic? is the credit quality for the long-term -- they sign up for long-term agreements. who is on the other side of the agreement and are they good for the money? that is important to know as well. i think they are. i don't own kinder morgan but -- >> i love yield. >> we all do.
>> be careful what you wish for. >> we're afraid of it. 7 is the worst. 8 is the worst? >> i think you have to be scared when yield -- stock prices going down and yield going higher, that is a concern. so answer your question, anything to me in this environment north of 6% should give you some is cautionary flag. kmi, even with the move lower is not a cheap stock in this environment. it trades close to 17 times forward earnings. to answer the question, is the pain over yet? i don't think so. oil prices, speaking of which, 7% down today. below 27 for the first time since 2003. people have talked about various bubbles popping. are we witnessing the end of the bubble. we've been talking about a credit bubble for so long and are they all related? >> i think they are all related. i think what we're seeing in oil
is four years of $110 prices attracting a whole lot of capital into incremental supply. and now we're awash in supply. the market is not able to absorb it all. so prices have a hard time finding a floor. that is what we're going through right now. >> any predictions on where the floor is found, finally? >> well, without putting a specific number out there, i would say that we're still in for quite a bit of fund. al issues over the course of the coming weeks. and the thing that concerns me the most is the buyer of crude oil is the refining system. the refining system is going into maintenance as we head into march. so the physical buyer disappears from the market for a period of time. that probably means we're heading quite a bit lower from here. >> jason, real quick, geopolitical risk, we assume that means the commodities goes higher. i would submit we are seeing that forcing the price down. do the saudis have a vested interest to keep the price of oil going lower? i think they do. i think it still has room to the
downside. brian kelly is saying 25 for a while. we're here. could it see the teens? >> it is certainly possible. because of the weakness in the demand side coming up in the next several weeks. the saudi tactic is playing out. perhaps even more successfully, if you want to look at it that way, as to what they would have anticipated. but you are going to start to see the supply side response. an fortunately i think it is in the back half of the year. but i expect u.s. crude production is down big as we look into the second half. >> you like chevron and shell, right? why? >> balance sheet strength. we are in a period right now where you have to have a stable, strong balance sheet to survive this period of weakness. that is why we're looking for the very best capitalized names within the sector that i think really have produced strong support for dividends. i think dividend yield is the biggest concern in the sector right now. >> are they safe on both of those companies? >> michelle has reiterated again
today they will not make a dividend cut in 2016. i think the ceo has pretty much staked his entire credibility on that and i think his board is behind him on it. in the case of chevron, the balance sheet entered the downturn in pristine condition. so i think chevron could survive a two-year period of oil prices where they are at right now and not really even stretch too much their credit-related ratios on the balance sheet and so i think they'll be fine. >> and shell? >> shell is going to not have quite a strong metric as chevron when it comes to the balance sheet but they could get through 2016 and meet the chairman's promise -- or the ceo's promise of not making a dividend cut. if we see $20 type oil moving into 2017, that is when we have to start being concerned about most of the companies in the sector. >> got it. thank you so much for joining us. let's have the same questions with the guys here on the set. the collapse of crude, has many
of the big oil companies, big dividends, are they in jeopardy? who is most vulnerable for cut. we'll call this game dead or alive. >> i love games. >> pete, lets a start with you. conoco-phillips, dead or alive? >> i think it is dead. when you look at cash flows, that is what i'm staring at. when the cash flow is $5 billion to the negative and you have $25 billion in debt, that is a major problem. they are going to have to do something about that. they have to address that. i think the one way to address that is cutting the dividend. i think that is partially why we're seeing the dramatic moves out of names, conico to the down side, and people are anticipating the dividend cut will be coming. >> okay. 8.5%. and chevron, and what is dead. >> i would say it is probably the second to last and another one is probably the last one. because of how good the balance sheet is. but when i look at oil, look at natural gas or oil from the 80s.
they have big declines and flat line for five to ten years. so i think it is a 2017-plus event but ultimately i think it is dead. >> karen, i think you have the toughest call. bp with a yield of 8%. the stock is also extremely political? >> yes, it is. we talked about this one before the show. it is a widow and orphans stock in the u.k. >> in the u.k. >> so the dividend is sacred. however, if i were they, i would cut some. because this is the time -- if ever it were raining and you want to -- have some money -- >> save some smn -- >> there is the time to do it. and they could biasets more accretive to earnings but it is hard. >> you have to remember the gulf of mexico and the big oil spill and they talked about the cut and they went crazy in the u.k. they didn't assume any risk. wait, there is risk is an oil
stock. >> but that is easier to cut when this oil market is a disaster and other people are doing it as well. >> guy? >> you know, back in d.c., a segment like this should have music accompanying it. don't you think. ♪ dead or alive >> smart guys and gals. as long as rex is there, they would rather fall on their sword than cut the dividend, yielding about 3.5%. the balance sheets of other companies are probably in better shape but i don't think exon cuts. it is a last-ditch effort. you would have to see oil around $10 a bail for that to happen. i don't see that happening. not dead, alive. >> still ahead, it was the one space that bucked the down trend. the biotech bounce back and the names that really stood out. plus, how you could get in on the action now. i'm michelle caruso-cabrera and
you're watching "fast money" on cnbc. because we are the best in worldwide. >> i'm going to kill the bear. >> but if the bear is still here to stay, what history says does well when the bear is growling. plus, suddenly end of the worlder like mark faber and peter schiff are starting to sound like hedge fund legend ray delion and it has traders flat-out bugging. and we'll explain why when "fast money" returns.
welcome back to "fast money." brutal day for the markets. and get this, some of the most well-known investors on the street are sounding at alarm on the fed's next move. the founder of the warld's largest hedge fund ray dalio saying the fed will not move toward tightening, but instead more q.e., echoing peter schiff. see what he said today from dav os and then what peter schiff has said. >> i think the shifts are asymmetric on the downside. i think the next major move in
fed will be toward quantitative easing not toward tightening. >> this recovery is over and the fed is trying to raise rates. they will quickly have to reverse course next year. they will take rates into negative territory, not just real rates but nominal rates and they'll do qe 4 and it could be bigger than ever. >> so could another round of qe be back on the table. >> go ahead, b.k. >> it should be. but what i'm fearful most of is that it is probably going to take a crisis for them to get to a point of hiking less than a month ago, now even talking about a hike in a week from now, to qe 4. the process from there to qe 4 is so massive, unfortunately it will take a crisis to get there. >> i totally agree with you. i don't think they could tight rate that finely on a terrible start to the year. but they would lose credibility. i can't see them doing it. but dalio didn't say right away.
so they could let it sit for a while maybe. >> but it is not like they should be doing qe at this point. >> so look at what is going on in china is quantitative tightening. they are sucking money out of the system. if you are look at what is going on here. they are sucking money out of the system. fewer dollar bills means the economy is going lower. there are fewer dollars to buy stuff with. the economy is going into recession in 2016. the federal reserve is crazy to raise rates. >> what do you say to the critics out there who said you were just another one of the tad traders addicted to the crack of cheap money. >> i wish they would have let it go down in 2008. i'm saying, what is the fed going to do? they are going to qe. it is the only option they have. it is the only tool they have. >> what is interesting about the conversation. so dalio comments today and everybody is laser focused on him. peter schiff has been saying similar for quite sometime. now the reason peter didn't get -- and i would say this if he was here, and it is because he is so damn unlikeable and he
revels in that. and if he says the sky is blue, we say it is red. but if you listen to his words there is wisdom in there. i don't agree with everything he said. but he did mirror the comments that ray dalio made today. i think the fed doing another round of easing is nuts but it won't happen until the back end of the year. >> and marc faber is talking about quantitative easing number 15. so if they back off are we back to the races? or has that ship sailed? >> it will give something to the market. it will give the market jitters. where are we? is it sand? >> speaking of sand. we have breaking news out of brazil. seema mody has the story. >> brazil central bank has left rates on hold at 14.25 %. this, despite growing expectations that they would raise rates in an effort to curb
inflation. they are dealing with a huge inflation problem. back above 12%. that is a 12-year high. and the vote was not unanimous. the central bank said two board directors voted for a 50-point hike. but the big concern for raising rates is that would lead brazil deeper into recession. the country dealing with two consecutive quarters of slowing growth. and the imf forecasting growth to drop by 3.5% this year in 2016. michelle. >> 14%, seema. ---y economy and a status leader who has no understanding of markets. that will happen. capital flight out the kazoo. anybody playing brazil here? >> no. it is a disaster. >> yes, it is a disaster. >> it is a complete disaster. i don't think you try to bottom fish. ewz is your etf on that and stay away until it washes out. there is a time to buy brazil but it is probably five years from now. >> could i go back to dalio for
a second. the reason it stands up today versus peter schiff, and you said unlikeable, and i don't know if i would say that but it is probably accurate but peter schiff has been saying this since the s&p was below 1000. and that is why with today dalio saying it, that is why it is important. >> but really quick, not to defend him, he doesn't need me to, but he doesn't say that doesn't mean the stock market could go higher. >> still ahead, ipos trading well below the ipo price. how much pain could be for the likes of go-pro, square and fitbit. and one of the europe's biggest banks hit an all-time low and some are betting it could go much lower. the name and how to play it when "fast money" returns. ng on here? oh hey allison. i'm val, the orange money retirement squirrel from voya. val from voya? yeah, val from voya. quick question, what are voya retirement squirrels doing in my house? we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person?
♪ light piano today i saw a giant. it had no arms, but it welcomed me. (crow cawing) it had no heart, but it was alive. (train wheels on tracks) it had no mouth, but it spoke to me. it said, "rocky mountaineer: all aboard amazing". welcome back to "fast money." major selloff with a bit of a comeback on the street tonight. the dow dropping more than 565
points, the lows of the session. and came well off the lows and ended down only 250 points. the s&p fell about 1% with the nasdaq turning positive actually after falling nearly 4%. driven by gains in the biotech sector. here is what is coming up in the second half of "fast money." big ipos and big problems. a number of stocks trading well below debut prices. we have the details on what, if anything, could save the newly-minted stocks. plus one of the largest european banks just hit an all-time low and traders are betting the pain is not over yet. we have all of the details later in hour. but first, wild swings this year have all ten s&p sectors in the red and with the s&p 500 in a correction, if stocks continue to sell-off, where is it safe to hide. dom chu is at headquarters with a look at sectors that have outperformed in previous market meltdowns.
>> well, michelle, some traders like to use history for a guide of what will happen in the future if history does repeat itself. if we look at the markets in correction in bear market territory for some. let's look at the last time we entered a bear market for stocks. and there are two different instances. in the case of the international bubble, march -- the internet bubble, in march of 2002 when the marks fall and bottom out it was the s&p losing half of its value. but the outperforming sectors were consumer staples and health care. that was a revaluation of assets during the internet bubble. a difference this time around, march of 2007 and 2009, markets bottoming out there. similar, more than half of the s&p 500 was gone. and consumer staples and health care in the red but outperforming the broader overall market. so perhaps it comes around this way as well. and let's look at what is happening now.
since may of 2013, the s&p lost 14%, not as dramatic, but still, utilities and consumer staples the outperforming sectors during this particular move down now. now the issue is whether or not this continues lower. a third potential outcome is this gets bought just like all of the other rallies have been bought since the financial crisis lows. but still it is interesting to look at the way certain sect years performed over the last two crises. they were different in nature. we'll see if this plays out in the same way or becomes a buying opportunity. back over to you. >> never seems to turn out the same way but let's trade it. you want to buy what goes down the least, is the lesson there. because everything could do gown in a major selloff. >> i think that is fair. and i would continue to -- and i know what dom said. it is well-done work. but i still think the two places to look at now continue to be the bond market. people point to it being in a bubble. i disagree. it will be. but that is not a story until the beginning of 2017. i think people will continue to
be surprised by how low rates will go in the united states. >> and what byou buy. >> the tlt. for the folks playing the home game, tlt. >> i would look at philip morris. dividend. outperformed the market. good relative strength in this market. so philip morris, that is my pick for this. i think you would be somewhat safe. it doesn't mean they can't go down in price but at least you get a dividend. >> yield of 4.75%. >> yep. i go to something like microsoft. i look at what they've been able to do in this transition. it is incredible into the cloud. they are doing an amazing. job. if you look at dividend yield there, that is one of the stocks today that hit 4910 during the trading session to get up and get over 51, closed just under 51. that has a yield and solid fundamentals. >> 2.8% on the yield for microsoft. karen? >> what did terribly last year? so it is down this year, xrt is
so, so overdon. when you think about the fundamentals are not bad at you will. >> the walmart? >> the spdr retail, yes. >> the move of the day. this is a new segment where we're looking at an etf with at least a 1% move in either direction, must have assets of $500 million and could not be a leveraged etf. check out one of the more risky sectors this year. biotech, the i shares nasdaq index, the ibb, look at the intra day chart, rallying through today's volatility. it market -- marked the moment of the day. driving higher by 3%. driving that is gilead, am gen, cell gen and with a buy rating. let's trade the guys. is this a harbinger, something to buy into. >> i'll be quick. celgene has a balance sheet that
most big cap pharmas would die to have. it should be trading north of 120 where it was a couple of weeks ago when it had the decision. i think the stock is cheap. i think biotech in general is cheap. when i say general, i talk about the names you discuss. am gen at 16.5 and 17 times forward earnings and gilead. >> i go right to am gen. cell gen, there is controversy. and this stock was down to 148. i was staring at it and thinking about it and never pulled the trigger and now kicking myself. finishing at 155. it sells off again. i think it was down to the 130s. that is a huge screaming buy at 16 times. >> i thought gilead, which is a name we talked about with gee. but in the depth of the worst of today, it kind of hung in there. it was down some of the -- of the etfs in general. it just seemed like, wow, they
can't go down that much more even though some are big momentum names. i think it is over for now, in the biotech selloff. still ahead, some of the biggest tech ipos in the last year are trading below the ipo price. will it mean less companies are willing to take the public plunge? we have the details next. much more "fast money" still ahead, so don't move.
with creative new business incentives, and the lowest taxes in decades, attracting the talent and companies of tomorrow. like in the hudson valley, with world class biotech. and on long island, where great universities are creating next generation technologies. let us help grow your company's tomorrow, today at business.ny.gov
2016 setting up to be the worst january ever for stocks. but it has been specially difficult for struggling tech companies that have recently gone public. josh lipton taking a look at the names that have struggled so much. >> a lot of young tech companies making headlines today for the wrong reasons. one of jack dorsey's companies, square, which is struggling today, touching 8.27. breaking the ipo price for $9 for the first time. go-pro, another name that did get whacked. slumping to 9.90 today. that was a new all-time low for the camera-maker. it did then bounce back at the close but still down some 54% from the offering price of $24.
and go-pro, by the way, not the only wearable maker facing a skeptical investor. fitbit going public at 20 last june and now down 10% from the offering price. and finally, there is no safe haven for the enterprise focus names either. box, for instance, finishing in the green but still down nearly 60% from the offering price of $14. investors wondering whether the cloud storage company could cut spending but maintain growth. one question will start-up founders here in silicon valley now take a look at performance of the recently ipo names and conclude that maybe for now life is okay as a private company. michelle, back to you. >> wouldn't be surprised if they think that. not one of the stocks pays a dividend. >> that is shocking. [ laughter ] >> let's trade it. do you buy any of them? >> i think go-pro is kind of interesting. i kind of like square. but i think that the door is
shut, obviously, for new ipos for a while. it is a huge distraction and it is expensive. when you look at something like -- i mean, go-pro down from the peak, obviously the peak was crazy. but down to here, it does have a good balance sheet. if you think there is anything there, the whole enterprise value is not that expensive at all. >> anything else look tempting, maybe? >> i would look at fitbit. i think that is interesting at these levels. in you look at what -- if you look at the wearable space, this is a nice tuck-in acquisition for somebody. if i'm garmin, i buy fit and integrate it into my stuff. and anybody else could buy them to. at these levels, it is worth a shot. >> petey, go ahead, real quick. >> i was going to say the ipos had more maturity when they came to the market. go-pro and fitbit, they had p.e. they didn't come into the market -- >> it is not the dotcom bubble all over again. >> it is different. off of what you were talking
about with groio-pro, the name t moves nicely with it is ambarella. finishing up 5% today. it is a chip name frxt a fundamental perspective, very solid. >> i sense hesitancy though. >> it is for good reason. real quick, twitter, and let me say this, i've been wrong for a long time in twitter, trying to figure out where the bottom is going to be. david seaberg has been spot on. today, traded 3 times normal volume. i think an all-time low. and closed up significantly. i get the takeover rumors. they always seem to be out there. but if nothing else, today might give you a bench mark to trade on the down side. >> interesting. coming up, one bank stock near the all-time low that traders are betting could drop another 25%. we'll reveal that name next. and the ceo of or arcle talks about the changing face of his business. that is right after the break. you're watching "fast money" on
cnbc. we're first in business worldwide. well, i've been doing some research. let me introduce you to our broker. how much does he charge? i don't know. okay. uh, do you get your fees back if you're not happy? (dad laughs) wow, you're laughing. that's not the way the world works. well, the world's changing. are you asking enough questions about the way your wealth is managed? wealth management, at charles schwab. okay, so you launched your bank's app. now what? how will you keep up with the new demands of today's digital economy? the fact is: some believe they won't need a traditional bank down the road, so at cognizant, we're helping banking and financial services companies think digital, be untraditional, and reimagine what the bank of the future can be. our clients can now leverage customer intelligence to predict their financial needs and provide more contextualized products and services.
we're creating new platforms across channels so customers can effortlessly invest, borrow, lend, transact-wherever-whenever they choose. and we're digitizing the way banks run, driving efficiencies and delivering new value for their customers in return. digital works for banking and financial services. lets talk about how digital works for your business. ♪
>> i think the stock takes care of itself. but it is very important for us, jim, to invest into this. we think this is a generational change in ip and we want to be on the leading edge of that. >> more on how oracle plans to change the landscape of technology and cramer gets his call on the crazy market. that is next on "mad money," just 7 minutes away. oracle, any of you like it or dislike it. >> two year hold. it has to hold $30. it has to be welcome back 10% of that. people say valuation is reasonable but you wonder at this point are they in the same declining business mode that ibm is. i don't think they are. but that is a battle they have to fight. shares of deutsche bank falling 5% after they expect a big quarterly loss in the fourth quarter. it sparked a flurry of action in the pits. mark chui is at the chart.
>> the stock trading on the lows and if we had a five-year chart you would see it is down 70% from the five year highs. and the active options, 1100 puts. the stock would finish down another 25%. somewhere down here, right off the right-hand side of the screen, by april expiration. >> wow. that is pretty startling, right. if that were true, you would think the german economy would stink and they are a global bank. is it beyond that or this is just such a problematic bank, guys? >> they are highly exposed. number one, they have the biggest derivative book in the world at $75 trillion plus. that is on a net basis. we know when everything has a problem, that explodes and net becomes gross. you have that issue. number two, they are exposed to the other european banks. we've seen the italian banks are having a tough time. and then exposed to the kmod
sector. bank of america and merrill lynch had a great report where they said about $100 billion from commodities exposure from glenn corp alone and that is unsecure debts. so there is all of the european banks and the balance sheets are almost too big to bail. >> and they are getting sued like crazy, too. >> and i'm long u.s. banks. that is my biggest fear, if they don't have the risk on their balance sheet it is such a global world, we saw what happened in '08 and it is more so now, that if deutsche bank has a problem, not good for any of them. >> that chart is horrendous. >> it is bad. >> and when you start talking about a big global bank, you talk about other big systemic issues and questions. a big oil company goes and it is problematic but banking is a whole other thing. >> b.k. has been on this and raoul pal said it would trade lower than that. and here we are now. is this the canary in the coal
mine. is this the today's market. it didn't bounce today. you might be spot on. >> over 7 million shares traded it trades over a million. >> guy is good on that. >> it was over 5%. we could talk inside, outside, on the web extra. we used to do that. >> mike. thank you so much. for more "options action" check out the full show at 5:30 p.m. eastern on friday. coming up next, the traders tell you what they are watching tomorrow right after the break. more "fast money" up next. here at the td ameritrade trader group, they work all the time. sup jj, working hard? working 24/7 on mobile trader, rated #1 trading app on the app store. it lets you trade stocks, options, futures... even advanced orders. and it offers more charts than a lot of other competitors do on desktop. you work so late. i guess you don't see your family very much? i see them all the time.
♪ time for the final trade. let's go around the horn. pete. >> we mentioned some of the stocks that made turns today. one of them was microsoft. i like that, solid company. i think it is ready to go higher. >> b.k. broiler. >> if you are itching to buy something. you don't have to, by philip morris. nice dividend, outperforming the market. >> karen. >> talking about things that have been crushed. here is one we are looking at. i think it is interesting. north star realty finance trading below book. it has a 27% yield which is obviously way too high, even if
they cut. i think it trades higher. >> mcc sister, since macy's had the lousy guidance, they traded well. 30 bucks. letter traded very well. >> catch fast money tomorrow. "mad money" with jim cramer begins now. my mission is simple to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere. i promise to help you find it t. "mad money" starts now. hey, i'm cramer, welcome to "mad money." welcome to cray america i'm trying to save you money. my job is to coach and teach. tweet me @jimcramer. it's not panic, it's methodical. it's not nuts, it's not erotic, it's in sync with the rest of the world. there lies the problem